FDI and innovation as drivers of export behaviour: firm-level evidence from East Asia

Type Working Paper
Title FDI and innovation as drivers of export behaviour: firm-level evidence from East Asia
Author(s)
Publication (Day/Month/Year) 2008
URL https://cris.maastrichtuniversity.nl/portal/files/1490275/guid-270bafa8-3504-459b-a024-f411eed528e3-​ASSET1.0
Abstract
This paper examines the links between ownership, innovation and exporting in electronics firms in three
late industrializing East Asian countries (China, Thailand and the Philippines) drawing on recent
developments in applied international trade and innovation and learning. Technology-based approaches
to trade offer a plausible explanation for firm-level exporting behavior. The econometric results (using
probit) confirm the importance of foreign ownership and innovation in increasing the probability of
exporting in electronics. Higher levels of skills, managers’ education and capital also matter in China as
well as accumulated experience in Thailand. Furthermore, a technology index composed of technical
functions performed by firms emerges as a more robust indicator of innovation than the R&D to sales
ratio. Accordingly, technological effort in electronics in these countries mostly focuses on assimilating and
using imported technologies rather than formal R&D by specialized engineers.

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